The devastating wildfires that have swept through southern Los Angeles and surrounding areas have inflicted an estimated $20 billion in damages, according to Reuters. This unprecedented destruction is putting immense pressure on the US home insurance industry, which is struggling to support affected families.
Many insurance companies have begun withdrawing coverage from high-risk areas, leading to a shortage of available policies and skyrocketing premiums. This trend is not limited to California; it is spreading across other high-risk regions nationwide, further exacerbating the issue.
A recent CBS report has raised alarms that the combined effects of massive property devaluation and the insurance sector's instability could ignite a financial crisis reminiscent of the 2008 economic downturn. CGTN's Guan Xin elaborates on how the financial landscape may be on the brink of significant turmoil due to these intersecting challenges.
Reference(s):
cgtn.com
